Deductions & credits

You are not doing anything wrong.

If there are any contributions to or distributions from your HSA during the year, then the IRS requires you to file form 8889 which documents the contributions and distributions, so that they can get the proper tax treatment.

Since your employer made contributions to your HSA, then you have to file the 8889.

Note that TurboTax generates the 8889 based on the HSA interview. Be sure to go all the way through the interview to the end (when you return back to Your Tax Breaks), because the employer's contributions won't be considered tax-free if the 8889 is not complete.